Chiquita in Latin America

by Nikolas Kozloff

www.counterpunch.org/, July 17-19,
2009

When the Honduran military overthrew the
democratically elected government of Manuel Zelaya two weeks ago
there might have been a sigh of relief in the corporate board
rooms of Chiquita banana. Earlier this year the Cincinnati-based
fruit company joined Dole in criticizing the government in Tegucigalpa
which had raised the minimum wage by 60%. Chiquita complained
that the new regulations would cut into company profits, requiring
the firm to spend more on costs than in Costa Rica: 20 cents more
to produce a crate of pineapple and ten cents more to produce
a crate of bananas to be exact. In all, Chiquita fretted that
it would lose millions under Zelaya's labor reforms since the
company produced around 8 million crates of pineapple and 22 million
crates of bananas per year.

When the minimum wage decree came down
Chiquita sought help and appealed to the Honduran National Business
Council, known by its Spanish acronym COHEP. Like Chiquita, COHEP
was unhappy about Zelaya's minimum wage measure. Amílcar
Bulnes, the group's president, argued that if the government went
forward with the minimum wage increase employers would be forced
to let workers go, thus increasing unemployment in the country.
The most important business organization in Honduras, COHEP groups
60 trade associations and chambers of commerce representing every
sector of the Honduran economy. According to its own Web site,
COHEP is the political and technical arm of the Honduran private
sector, supports trade agreements and provides "critical
support for the democratic system."

The international community should not
impose economic sanctions against the coup regime in Tegucigalpa,
COHEP argues, because this would worsen Honduras' social problems.
In its new role as the mouthpiece for Honduras' poor, COHEP declares
that Honduras has already suffered from earthquakes, torrential
rains and the global financial crisis. Before punishing the coup
regime with punitive measures, COHEP argues, the United Nations
and the Organization of American States should send observer teams
to Honduras to investigate how sanctions might affect 70% of Hondurans
who live in poverty. Bulnes meanwhile has voiced his support
for the coup regime of Roberto Micheletti and argues that the
political conditions in Honduras are not propitious for Zelaya's
return from exile.

Chiquita: From Arbenz to Bananagate

It's not surprising that Chiquita would
seek out and ally itself to socially and politically backward
forces in Honduras. Colsiba, the coordinating body of banana
plantation workers in Latin America, says the fruit company has
failed to supply its workers with necessary protective gear and
has dragged its feet when it comes to signing collective labor
agreements in Nicaragua, Guatemala and Honduras.

Colsiba compares the infernal labor conditions
on Chiquita plantations to concentration camps. It's an inflammatory
comparison yet may contain a degree of truth. Women working on
Chiquita's plantations in Central America work from 6:30 a.m.
until 7 at night, their hands burning up inside rubber gloves.
Some workers are as young as 14. Central American banana workers
have sought damages against Chiquita for exposing them in the
field to DBCP, a dangerous pesticide which causes sterility, cancer
and birth defects in children.

Chiquita, formerly known as United Fruit
Company and United Brands, has had a long and sordid political
history in Central America. Led by Sam "The Banana Man"
Zemurray, United Fruit got into the banana business at the

turn of the twentieth century. Zemurray
once remarked famously, "In Honduras, a mule costs more than
a member of parliament." By the 1920s United Fruit controlled
650,000 acres of the best land in Honduras, almost one quarter
of all the arable land in the country. What's more, the company
controlled important roads and railways.

In Honduras the fruit companies spread
their influence into every area of life including politics and
the military. For such tactics they acquired the name los pulpos
(the octopuses, from the way they spread their tentacles). Those
who did not play ball with the corporations were frequently found
face down on the plantations. In 1904 humorist O. Henry coined
the term "Banana Republic" to refer to the notorious
United Fruit Company and its actions in Honduras.

In Guatemala, United Fruit supported the
CIA-backed 1954 military coup against President Jacobo Arbenz,
a reformer who had carried out a land reform package. Arbenz'
overthrow led to more than thirty years of unrest and civil war
in Guatemala. Later in 1961, United Fruit lent its ships to CIA-backed
Cuban exiles who sought to overthrow Fidel Castro at the Bay of
Pigs.

In 1972, United Fruit (now renamed United
Brands) propelled Honduran General Oswaldo López Arellano
to power. The dictator was forced to step down later however
after the infamous "Bananagate" scandal which involved
United Brands bribes to Arellano. A federal grand jury accused
United Brands of bribing Arellano with $1.25 million, with the
carrot of another $1.25 million later if the military man agreed
to reduce fruit export taxes. During Bananagate, United Brands'
President fell from a New York City skyscraper in an apparent
suicide.

Go-Go Clinton Years and Colombia

In Colombia United Fruit also set up shop
and during its operations in the South American country developed
a no less checkered profile. In 1928, 3,000 workers went on strike
against the company to demand better pay and working conditions.
At first the company refused to negotiate but later gave in on
some minor points, declaring the other demands "illegal"
or "impossible." When the strikers refused to disperse
the military fired on the banana workers, killing scores.

You might think that Chiquita would have
reconsidered its labor policies after that but in the late 1990s
the company began to ally itself with insidious forces, specifically
right wing paramilitaries. Chiquita paid off the men to the tune
of more than a million dollars. In its own defense, the company
declared that it was merely paying protection money to the paramilitaries.

In 2007, Chiquita paid $25 million to
settle a Justice Department investigation into the payments.
Chiquita was the first company in U.S. history to be convicted
of financial dealings with a designated terrorist organization.

In a lawsuit launched against Chiquita
victims of the paramilitary violence claimed the firm abetted
atrocities including terrorism, war crimes and crimes against
humanity. A lawyer for the plaintiffs said that Chiquita's relationship
with the paramilitaries "was about acquiring every aspect
of banana distribution and sale through a reign of terror."

Back in Washington, D.C. Charles Lindner,
Chiquita's CEO, was busy courting the White House. Lindner had
been a big donor to the GOP but switched sides and began to lavish
cash on the Democrats and Bill Clinton. Clinton repaid Linder
by becoming a key military backer of the government of Andrés
Pastrana which presided over the proliferation of right wing death
squads. At the time the U.S. was pursuing its corporately-friendly
free trade agenda in Latin America, a strategy carried out by
Clinton's old boyhood friend Thomas "Mack" McLarty.
At the White House, McLarty served as Chief of Staff and Special
Envoy to Latin America. He's an intriguing figure who I'll come
back to in a moment.

The Holder-Chiquita Connection

Given Chiquita's underhanded record in
Central America and Colombia it's not a surprise that the company
later sought to ally itself with COHEP in Honduras. In addition
to lobbying business associations in Honduras however Chiquita
also cultivated relationships with high powered law firms in Washington.
According to the Center for Responsive Politics, Chiquita has
paid out $70,000 in lobbying fees to Covington and Burling over
the past three years.

Covington is a powerful law firm which
advises multinational corporations. Eric Holder, the current
Attorney General, a co-chair of the Obama campaign and former
Deputy Attorney General under Bill Clinton was up until recently
a partner at the firm. At Covington, Holder defended Chiquita
as lead counsel in its case with the Justice Department. From
his perch at the elegant new Covington headquarters located near
the New York Times building in Manhattan, Holder prepped Fernando
Aguirre, Chiquita's CEO, for an interview with 60 Minutes dealing
with Colombian death squads.

Holder had the fruit company plead guilty
to one count of "engaging in transactions with a specially
designated global terrorist organization." But the lawyer,
who was taking in a hefty salary at Covington to the tune of more
than $2 million, brokered a sweetheart deal in which Chiquita
only paid a $25 million fine over five years. Outrageously however,
not one of the six company officials who approved the payments
received any jail time.

The Curious Case of Covington

Look a little deeper and you'll find that
not only does Covington represent Chiquita but also serves as
a kind of nexus for the political right intent on pushing a hawkish
foreign policy in Latin America. Covington has pursued an important
strategic alliance with Kissinger (of Chile, 1973 fame) and McLarty
Associates (yes, the same Mack McLarty from Clinton-time), a well
known international consulting and strategic advisory firm.

From 1974 to 1981 John Bolton served as
an associate at Covington. As U.S. Ambassador to the United Nations
under George Bush, Bolton was a fierce critic of leftists in Latin
America such as Venezuela's Hugo Chávez. Furthermore,
just recently John Negroponte became Covington's Vice Chairman.
Negroponte is a former Deputy Secretary of State, Director of
National Intelligence and U.S. Representative to the United Nations.

As U.S. Ambassador to Honduras from 1981-1985,
Negroponte played a significant role in assisting the U.S.-backed
Contra rebels intent on overthrowing the Sandinista regime in
Nicaragua. Human rights groups have criticized Negroponte for
ignoring human rights abuses committed by Honduran death squads
which were funded and partially trained by the Central Intelligence
Agency. Indeed, when Negroponte served as ambassador his building
in Tegucigalpa became one of the largest nerve centers of the
CIA in Latin America with a tenfold increase in personnel.

While there's no evidence linking Chiquita
to the recent coup in Honduras, there's enough of a confluence
of suspicious characters and political heavyweights here to warrant
further investigation. From COHEP to Covington to Holder to Negroponte
to McLarty, Chiquita has sought out friends in high places, friends
who had no love for the progressive labor policies of the Zelaya
regime in Tegucigalpa.

Nikolas Kozloff is the author of Revolution!
South America and the Rise of the New Left (Palgrave-Macmillan,
2008) Follow his blog at senorchichero.blogspot.com